Despite Growth, Still Not Enough Jobs
Employment: Many were impressed with the 244,000 new jobs reported in April. But not us. Many of those new hires likely came at one company, and the unemployment rate actually rose. The jobless expansion continues.
We've been accused of being unnecessarily gloomy about the current expansion. And truth is, both the economy and jobs are expanding right now. In April, private-sector payrolls added 268,000 positions, the biggest one-month gain since February 2006. It was the 14th straight month of job gains, 2.1 million in all.
Nearly one in four of the April jobs, however, may have come at one company - McDonald's, which hired 62,000 workers from a million applicants. We're not knocking Big Mac - it's a great business - but economic growth can't be sustained with burger flippers.
Even if McDonald's isn't included, this remains the worst job recovery since the Great Depression. We stand 7 million jobs below our peak of 138 million in December 2007, just as the recession began.
The economy must create about 120,000 jobs a month just to sop up new entrants into the workforce. So even at the current pace, it'll take nearly four years just to get back to where we were in 2007. Is that progress?
Coming from a White House that, in addition to hope and change, promised 3.5 million new jobs annually, or 292,000 a month, the April report is disappointing.
Fact is, the job picture is worse than it seems. The unemployment rate ticked back up to 9% in April from 8.8% in March and is still within spitting distance of the 9.5% reached in June 2009 as the recession ended.
Our own IBD/TIPP Poll asks Americans every month if someone in their household is unemployed and looking for work. This month, 21% responded in the affirmative. That's the real unemployment rate.
When you add in discouraged workers and those with part-time jobs who want to work full time, the official jobless rate doesn't look so good - 15.9%, just below the 16.6% in June 2009.
The average spell of unemployment today is 38.3 weeks, close to its all-time high. Even after the 1982 recession, then the worst since the '30s, the duration of unemployment never got above 21 weeks.
This has hurt President Obama more than he realizes. IBD/TIPP also asks people to grade the president on how he's doing creating jobs and economic growth. In this month's poll, 46% described it as "poor" or "unacceptable."Just 26% gave "good" or "excellent" marks.
None of this is an accident, of course. When things go badly, it's almost always due to bad policies.
We can feel their impact in continued declines in home prices, soaring food inflation and gasoline at over $4 a gallon. We see it too in the alarming and dangerous buildup of spending and public debt, which under Obama has leapt to $14 trillion from $9 trillion.
All this comes from an administration that clings to absurd Keynesian ideas that more spending and higher taxes will create jobs and economic growth.
We know those things don't work. The White House must either yield to reality and change course, or the voters will change it for them in 2012.
